What designated services mean in practice

The trigger for compliance

A "designated service" is a specific business activity that triggers your obligation to comply with AML/CTF laws. You only need to apply the heavy regulatory rules to the parts of your business that offer these specific services—not necessarily your entire operation.

Examples in practice

In the real world, providing a designated service means you are doing tasks that carry a higher risk of money laundering. For example:

• Buying or selling real estate on behalf of a client.
• Receiving, holding, or managing client money in a trust account.
• Creating, operating, or managing companies, trusts, or partnerships for clients.
• Buying or selling high-value precious metals or stones.

What happens when you provide one?

Once you provide a designated service, the law requires you to take action. You must perform background checks on the clients involved in those transactions (Customer Due Diligence), keep highly accurate records of the activities, and report any suspicious behaviour or large cash transactions to AUSTRAC.